The Supreme Court of Victoria has found liquidators can be made personally liable for clean-up costs in respect of land that was, on their appointment, polluted or environmentally hazardous as “occupiers” under the Environment Protection Act 1970 (Vic) (EP Act). A disclaimer notice issued by the liquidators in respect of polluted property was set aside, preserving the liquidators’ indemnity from a related third party for that environmental liability. This left the liquidators (and consequently their indemnifiers) unable to avoid an obligation in due course to pay the Environment Protection Authority (EPA) its clean-up costs.
Civil liability for such costs is in addition to the potential criminal liability imposed on persons concerned in management under the EP Act for breaches by a company of its obligations under that legislation. The reasoning of the Court could also have implications for receivers and administrators of companies holding land that is, on their appointment, polluted or environmentally hazardous.
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